Scanning The Political Scene As We Approach Elections
Are you sick of the stupid political ads yet? I am. Unfortunately, I’m fairly disengaged in the political scene right now because while I think the Democrats need to be voted out, I’m not really excited about many of the Republicans that are likely to fill the seats. I like a few, but by and large, it’ll be more of the same.
Here is a good excerpt from a Buchanan column describing the scene:
Consider the critical issue facing America today – the budget and trade deficits, the soaring national debt, an unemployment near 10 percent for 14 straight months – and how neither party seems to have the cure.
While George Bush’s tax cuts did not cause this, they did not prevent it. And if Republicans believe that his deficits did cause it, why have those Republicans not addressed the causes of those deficits – Bush’s wars, Bush’s tax cuts and Bush’s social spending on No Child Left Behind and Medicare drug benefits?
Yet, if liberal Democrats are right and deficits are the correct Keynesian cure for recession, why have Obama deficits of $1.4 and $1.3 trillion failed so dismally? Paul Krugman says they are not large enough. Perhaps, but the country is about to end the experiment.
The Federal Reserve, having used and broken every tool in its toolbox, including doubling the money supply and setting interest rates at near zero, will now bet the farm on inflation, starting Nov. 3.
Both parties have lost the mandate of heaven, and neither knows if its economic philosophy even works anymore.
Here’s another good quote from Mark at FundMyMutualFund.com:
I expect the Fed to continue to manipulate things. Greenspan said a year ago that the stock market rising was the best form of stimulus and Ben finally caught on 2 months ago. He has to be tickled pink at his ability to manipulate the psyche.
The GOP is mostly for show for now – they had complete power for 6 years and spent as much as the Dems… unless Tea Party takes over 40 seats which is not going to happen. Basically the next 2 years I see the GOP doing almost nothing but investigations – they want a bad economy to win the 2012 presidency and that’s what politics has become now… do nothing but sabotage the other party to win power, even if the people you represent suffer.
The Fed (in its mind) is trying to compensate for America’s completely dysfunctional political system by using blunt force objects. Our problems are structural and long term in nature and would require pragmatic, long term thinking – hence we have no chance to solve them. Instead we’ll attend to emergency fires as they pop out and use the fed to “fix everything”, as they foment the next bubble. which they can then come to the rescue on their white horse in 3-6 years and say “aren’t you glad we are around!
So, while I’m glad a larger chunk of the productive class in America is waking up to some degree, I do not think for a second that we’ll be back onto the path of prosperity starting next Tuesday. As Mark says in this quote, the problems are structural and have nothing to do with Republican vs Democrat.
The bigger news will probably be what the Fed announces the day after the elections. Stay tuned…